Cool Japan Fund chief says crafty marketing key to regional revivals

Japan still has a wealth of products that can be sold to the world, and many are still waiting to be discovered, according to Nobuyuki Ota, CEO of the newly founded Cool Japan Fund Inc.

The fund, set up in November under a public-private Cool Japan initiative to promote home-grown products overseas, will closely network with regional governments, municipalities and banks to pursue projects that show promise, Ota said in a recent interview.

If the fund succeeds, some of the nation’s battered regional economies may get an unexpected lift.

“I want to say, ‘Let’s energize local economies together.’ If we can have one or two successful cases in your prefecture, others will follow suit,” said Ota, a former executive at department store chain Matsuya Co.

“This may sound extreme, but if they don’t push themselves, local economies will not find ways to get energized again,” he said.

The Cool Japan strategy is one of the government’s key industrial and economic policies. The government provided ¥30 billion and 15 private firms chipped in a combined ¥7.5 billion for the fund. They include ANA Holdings Inc., Dentsu Inc., Namco Bandai Holdings Inc., Dai Nippon Printing Co. and Mizuho Bank.

The fund’s main role is to source marketable products and help promote them overseas so Cool Japan can create opportunities for Japan’s firms while promoting its goods and culture on a larger, global scale.

The Cool Japan Fund also plans to build Japanese shopping centers in major cities and get foreign TV stations to broadcast more Japan-related content.

As an example of a successful model, Ota mentioned Dassai, a sake brewed in Yamaguchi Prefecture. By actively marketing the tipple abroad, Asahishuzo Co. has turned Dassai into one of the most popular brands sold today, in Japan or abroad.

“We hope to strategically copy such cases,” Ota said.

When promoting products overseas, it is important they be presented in a package, he said.

For instance, when trying to sell rice, at the same time you can promote Japan’s rice-eating culture by cooking it in the traditional way. This gives you a way to sell not only rice, but the earthen pots it is cooked in and Japanese culture.

Ota mentioned a number of short-term goals for the fund, such as trying to explain what Cool Japan means.

“People have different images of Cool Japan, so we have to provide our image of Cool Japan in a way that people can easily understand,” Ota said.

Many Japanese will probably think of manga or anime — elements of so-called otaku (geek) culture. But Cool Japan includes a whole range of things, like fashion, food and even culture or customs, said Ota, who was also a former president of fashion design company Issey Miyake Inc. and spent most of his career in fashion-related jobs.

Ota said many industries associated with Cool Japan have been given the cold shoulder by the government compared with automobiles and electronics.

The government admits that even though manga, anime, fashion and food might be popular overseas, they are not having much success making money, which is why the Cool Japan Fund is now trying to take a more strategic approach.

“The state has realized that these industries will play important roles in creating future growth opportunities for Japan,” Ota said.

I live in Brazil. My point of view is that the Cool Japan Fund should invest in Brazil because as we don’t have technological knowledge and we are very bad at research & development, we need multinational companies to build everything.

Japanese technology could be used here in many areas, mainly in infrastructure sector.

Recently our country is trying to modernize its railroads and trains. Previously, all of them were made with european technology. But lately, technology from South Korea is being contracted. Also, there is an open bidding over a Bullet Train line that Brazil wants to build connecting São Paulo to Rio de Janeiro. But it seems the japanese will not win the bid. I always ask myself. Why not? The japanese invented the bullet train. Why they can’t win this bid?

I don’t know the numbers, but I feel that South Korean companies have invested in Brazil much more than Japan in the last years. Companies like Samsung, Hyundai (including Hyundai Heavy Industries) and Kia are becoming very sucessfull here. Why that? Brazil has lots of japanese descendants. So why South Korean companies are being more sucessfull here than the Japanese ones?

When I lived in Japan I was impressed about how fast is to build a prebuilt house. We don’t have it in Brazil yet. Everything is made with concrete, brick, tiles, with a very old technology that is being used for the last 50, 80 or maybe 100 years.

Japanese techniques of gardening and agriculture could be used here too. Every year in Brazil we see agricultors losting its cultivation because there is less rain or more rain than expected. The techniques here are very rudimentar. When I lived in Japan I was impressed how fruits and vegetables were big and tasty. When travelling in the japanese expressways I could see some plantations and I felt they were very organized. I kept asking myself why brazilians plantations could not be like that, giving that we have a so big country and we have lots of space to cultivate. Japanese gardening is also very beautiful and I can say recently there are major advances in this area in Brazil, with new buildings being made with very beautiful gardens. Gardens were not so popular here 10 years ago.

Brazil also lacks japanese companies in consumer goods and food industry sectors. The industry sector is monopolized by european and american companies with its major players being Nestle (anglo-swiss), P&G (american), Cargill (american), Bunge (american), Unilever (anglo-dutch) and many others. The only relevant japanese company in this sector is Brazil Kirin that have initiated operations in Brazil only this year.

In the eletronic goods area, Samsung and LG have been choosen as the preferred brands when buying TVs, Monitors and Cell Phones.

In the automobile area, Toyota has only 5.17% of market share. Just look at the market share of November 2013: Fiat (italian, with 20.72%), Volkswagen (german, with 18.25%), GM (american, with 17.85%), Ford (american, with 9.22%), Renault (french, with 7.2%), Hyundai (korean, with 6.67%). Shame that globally the japanese companies sell very good and at Brazil they perform very bad.

The centralized distribution system of Japan could also be copied here. In Brazil every manufacturer has the responsibility to deliver the products at each store. For example, Coca Cola has to ship cola to all bar and restaurants. Every manufacturer has to create their deliver network infrastructure. I know that Japan has a ready-to-use centralized deliver infrastrucutre and it could be implemented here too.

Japan for sure has many interesting products that could be sold here. I can’t understand why the americans and europeans do that and the japanese don’t.